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Apr-Jul 2013 Earnings Preview
Auto Companies ‐ Raw Material Index
108.0
106.0
104.0
102.0
100.0
98.0
96.0
94.0
92.0
Q1FY13 Q2FY13 Q3FY13 Q4FY13 Q1FY14E
Source: PL Research
We have built a raw material index giving different weightage to different
commodities. We have assigned highest weightage to Steel (45%), followed by
Aluminium (20%) and Plastics/Polymers (15%). Our raw material index declined by
~3.0% QoQ. Major raw materials have declined by 5-8% in the last few months.
However, rupee has depreciated by 4-5%, thereby, negating the impact of softer
commodity prices. Due to lower volumes across the board and not much benefit on
the commodity front, we expect EBITDA margins to contract 15bps YoY to 13.1% for
the quarter.
Our universe – Volume numbers
Company Q1FY14E YoY gr (%) QoQ gr (%)
Ashok Leyland 21,721 (21.0) (37.3)
Bajaj Auto 972,134 (9.9) (1.0)
Hero Motocorp 1,559,282 (5.1) 2.0
M&M 194,962 7.0 ‐
Maruti Suzuki 266,434 (10.0) (22.5)
Tata Motors 153,172 (18.9) (22.0)
Tata Motors JLR 91,584 9.7 (21.3)
Source: Company Data, PL Research
Tata Motors is likely to post a 17.8% decline in PAT on account of higher
depreciation and amortisation charges at JLR and a loss of Rs4.3bn on the
standalone business. Hence, the PAT for the coverage universe is likely to witness a
6.6% YoY de-growth. Excluding Tata Motors, PAT would grow by 5.2%, led by 16.1%
growth for M&M and a 69.9% growth for Maruti Suzuki (not comparable due to
merger with Suzuki Powertrain), for the quarter.
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